Has the Stock Market Already Hit Bottom? Here's a Better Question to Ask.
It is hard not to watch the S 500 index or the Dow Jones Industrial Average if you own stocks. They are a barometer of the market, and your portfolio will likely be performing better when broad indexes are rising than when they are falling. But a huge temptation here is to start market timing, only putting money to work when you think the market has bottomed and will head up again. Instead of focusing on the forest, start focusing on the trees.
Benjamin Graham, considered the father of fundamental analysis and the man who helped train Warren Buffett, used the analogy of Mr. Market when discussing investing. Mr. Market is mercurial; you never know what kind of mood he's going to be in. When he's upbeat, he'll agree to buy your stocks at high prices. When he's downbeat, he'll sell his stocks at low prices. It's a pretty good way to think about investing, since you want to buy low and sell high. But the really valuable moral of this story is probably the mercurial part, since you can't possibly know Mr. Market's mood in advance.
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Source Fool.com
